Serbia hopes to reach agreement with the International Monetary Fund (IMF) over its budget deficit by May, Branko Lukovac, the minister for international economic relations for Serbia and Montenegro said on Sunday.
Serbia said last Monday it could not cut its 2004 fiscal gap to below 3.0 percent of gross domestic product as advised by the IMF, but vowed to continue to lower the deficit and overall spending.
"We are hopeful that the differences are discussed and might be further mitigated, so that probably in April or at the latest in May, we may reach agreements both with regard to the deficit in Serbia's budget as well as with regard to reform of the pension system and health system and tax system in Montenegro," Lukovac told Reuters in an interview.
An IMF mission recently completed a two-week visit to Belgrade to check if policy plans remained in line with pledges made in 2002 when it granted Serbia a three-year $889 million loan.
Serbia last drew a $140 million loan tranche in late July 2003 and a new agreement would pave the way for the release of a new $150 million tranche.
Lukovac is in Tokyo for a conference on peace consolidation and economic development of the western Balkans on Monday.
Lukovac also said Serbia and Montenegro hoped to attract more foreign direct investment to diminish reliance on loans from the IMF, World Bank and international donors now that countries in the region were being linked by free trade agreements (FTAs).
"What is needed now is to concentrate more on direct investment rather than to expect much more on the loans," he said.
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